The Zambian government should repeal or at least suspend the Employment Code Act, according to a report by one of the country’s leading economists and a human resource expert.
The report further recommends the establishment of a multi-sector Employment and Labour Legislation Taskforce, which should undertake a comprehensive review of the Employment Code Act. This action should be taken immediately, with a reversion back to the previous legislation pending further review.
“It is strongly recommended that the Employment and Labour Legislation Taskforce undertakes extensive consultations with all the relevant stakeholders to ensure that all the submissions are seriously considered bearing, in mind that what may appear to be in the best interest of employees in the short-term could result in serious repercussions in the medium- to long-term in term in forgone opportunity to enable employers to remain viable and profitable, which is essential for securing jobs and employment expansion,” they continued.
The report, Critical Assessment of the Employment Code Act by Professor Oliver Saasa of Premier Consult and Felix Mwenge, a research fellow in the Human Development Unit of the Zambia Institute for Policy Analysis and Research (ZIPAR), says the Employment Code Act (ECA) has introduced significant complications to labour and employment legislation in Zambia, which calls for urgent introspection before it begins to seriously affect growth prospects.
The mining sector has been particularly hard hit by the new legislation because of the large numbers of people it employs, they noted.
The mining industry is a significant employer: 85,111 people were employed in the sector in 2018. In that year, the mining sector accounted for 7 percent of wage employment and 3 percent of total employment in Zambia, according to the report.
The number of women employed in the mining and quarrying sector was 9,713 in 2018, which represents 11 percent of the total employed in the sector.
Multiplier effects in companies directly or indirectly supplying the mines adds to this impact, they continued. However, the researchers note that the ECA will negatively impact on the employment of women.
Jobs in contractors’ firms, for example, are intimately linked to the buoyancy of the mining sector, and any changes to labour and employment laws that result in disruptions in the sector would threaten growth among contractors.
The new legislation did not consider the implications at the micro- and macro-economic levels, and was ill-timed against the backdrop of subdued economic growth in the coun country, said the report.
“Considering the magnitude of discomfort among employers regarding the provisions of the ECA, particularly those in the small-scale category, it is clear that, in its present form, this piece of legislation would be difficult to enforce. Even where willingness on the part of an employer is not an issue, the current economic situation in the country makes it difficult to adhere to many of the ECA’s provisions,” they explained.
“The all-embracing character of ECA has left some employers, particularly those in the small-scale category, perplexed regarding the prospects of its enforcement for the currently financially-stressed small business. To the extent that the ECA covers all categories of employees, this has resulted in significant challenges at the operational level with some categories of employers finding the law difficult to adhere to,” said the experts.
The authors noted with concern liquidity challenges, government crowding out of the private sector, rising debt levels, and policy inconsistency for some sectors had combined to make the investment environment not hospitable and the ease of doing business problematic.
Increasing debt service costs amidst a high fiscal deficit are also among the major macroeconomic challenges facing Zambia presently and have clouded the country’s fiscal outlook.
The external debt stock in February 2020 stood at around US$11.2 billion (inclusive of guarantees). The country’s domestic debt is currently in the region of US$5 billion and the total public debt is now estimated at over 90 percent of GDP,” they continued.
The consultants have further warned that inadequate or inappropriate legislation for labour market protection may hurt optimal allocation and application of labour as a vital resource in production.
“The Zambian economy is currently operating in a very challenging macroeconomic environment, which requires it to make hard policy choices that include the need to implement difficult reforms that may directly impact labour in an adverse way. At the external level, the sluggish growth of the global economy has affected Zambia’s growth prospects, which could result in serious labour shedding by industry,” they added.
The researchers noted that was the responsibility of governments to ensure that workers’ rights and entitlements were not flouted by employers and hence the securing of these rights through legislation is standard practice globally.
However, the most critical consideration that has been expressed by most of the employers and, to some extent, some employees, is that the ECA would cause significant cost escalation for the average company in Zambia.
It would be good if the author of this article gave a brief explanation of what the ECA is. All I’m reading are just submissions by the economist on why it should not be implemented or at least delayed.
Someone to help me plz; what does this ECA piece of legislation stipulates? LT are too lazy to highlight the contents.
I AGREE WITH @ DOVER
WHAT THE HELL IS THE CODE ABOUT
AND THIS FROM A CONSULTANT
It would be helpful if the specific challenges are cited in this article otherwise it reads like what an average man on the street would come up with.
@Ben Dover…the employment code act ( eca) is already law and one wonders where employer representatives where when legislation was in its infancy.The act is covertly aimed at appeasing workers in the usual ” pro poor” style but clearly without consideration for long term business survival. In its current form, the eca will hurt the people it was intended to protect especially in the long run. For example those running SMEs might find it only prudently safer to employ ‘relatives’ if they want to stir away from future labour related litigations. But overally, one thing is clear: It’s problematic when unionists become labour ministers as they miserably fail to do the balancing act.
Were was this labour expart at infancy level? Are they telling us they are hearing and learning about it for the first time?Lets try it and if it fails we come back to the drawing board.Am very sure the representatives from employers and ILO were around for consultation.Are these not suppose to be global trends?
I know Oliver saasa, he is a seasonal consultant who makes money where there is a perceived problem. These consultants will make up a theory that something is wrong so that they can be consulted. I mean, if they didn’t, then how would they survive? For that reason I can’t take this seriously. However I will take it seriously the day consultants like saasa work on a project without remuneration.
What exactly within the provisions of the labour law will be damaging to the the mines or companies mate? be specific, dont just write to show people you know some english.
read and read and read read read hoping to find the problem with the act spelt out. wasted my time.
This act is really terrible. An example is the stuation with women employees. It provide for:
(90 Days) Martenity leave.
1 Day mother,s day
24 Days Annual leave
7 Days family care leave
3 days compassionate leave.
Gratuity is now based on gross and not the basic.
Rather employ men and leave the women to be tending to families.
Kaizar, others give complainants in assault case 14 days to serve them amended writ, claim
FORMER special assistant to the President for political affairs Kaizer Zulu and his co-defendants have given a 14-day ultimatum to four Lusaka residents who have sued them for assault, kidnapping, among others, to serve them with the amended writ and statement of claim or withdraw the matter.
Zulu and two others submitted that they intend to defend the action against them.
This is in a matter where Bernard Nshindo, Sengelwayo Jere, Saul Masikoti, who are qualified surveyors and businessmen, and Mason Mweemba, a driver, have sued Zulu and his acquaintances Mpange Kachingwe (Major Richard Kachingwe’s son), Raffiq Rashid, and Bella Mwanza, a director of Chita lodge Limited are seeking, among other…
KZ,IS SO POWERFUL IN ZAMBIA
These are useless chaps with their face papers of economies.We have educated people who protect foreigners .Please govt don’t listen to these corrupt chaps.Zambians have been abused for so long.Let us keep these laws.Don’t even change them.PF you have done great job to protect Zambians.Let us not allow these chaps to mistreat us.PF,you’ll win elections bcoz of the same labour law.Who can trust HH and his minions ?They want to abuse Zambians.Please don’t listen ba Lungu. Mama Nonde and Kazhiya you’re great citizens for standing up for Zambians.
We need companies which are innovative and creative in this country.It pains me when i see employers working up and just declare you redundant for no apparent reason just bcoz you couldn’t agree with your boss.Capitalism will destroy this…
This is the problem in Zambia. Knee jerk reactions. Yes the economic climate is harsh, but will it stay gloomy forever? The copper price is cyclic. The history is there for all to see. What will happen when the copper price improves? Are you going to change the Employment Act again? This Employment Act is now the new consultant/investor/government football, like the windfall tax debacle! I do NOT agree with professor Saasa. We cannot and should NOT be changing legislation like underwear! Same problem with the constitution. Every president we have had wants to tinker with the constitution. What a country!
SAASA you want empolyers to declare zambians redudant anytime they feel like doing?You want employers to pay basic salary as gratuity?Do you know what they have done?The have reduce basis pay for example K5,000,house allowance 12,000,transport 10,000 and other staff 2,000.
These employers are thieves.How can you pay somebody gratuity on K5000 who get gross pay of K27,000 kwacha.Zambians becareful with these chaps who support UPND.PF the people are wth you.If such laws are implemented only innovative and creative companies will be in Zambia.let us stop having useless companies who abuse employees.Mind you ,yo have not even explained which law.Uselesssss consultants.
THIS IS ONE OF THOSE PIECES OF LEGISLATURE WHERE THE PF GOVERNMENT HAS DONE AN EXCELLENT JOB. EVEN AS WE MAKE MONEY, WE NEED TO ALSO PROTECT THE WORKERS…GOOD LAW THIS IS
Professor Saasa earns his income legitimately as a professional rendering services to the general public. If PF was inclusive would have made him contribute more effectively in public life. However, PF is allergic to professional way of doing business, to them its ‘Nchekeleko’ mantra sung by the head to the toes of PF cadres. As for rogue KZ is like a parasite or leech earning his dirty income where he has humiliated, kidnapped, fired guns and shot Zambians and dehumanise Zambians. Zambians deserve justice and time is coming to get it. Cleansing yourself on this site will not wash up, records, living witnesses exist and testimonies will be in your face. Agony is waiting for your fate in the next Zambia
Wrangling you seem to thrive under hearsay. I do not comment on matters that maybe in the courts of law. If I have done anything wrong I have always asked relevant authorities to investigate me. If I had dirt on me, I wouldn’t be here working side by side with his one and only Republican president. Do not let jealousy eat you up. I am a hard worker who came from nothing and made it to where I am today. I have seen and lived in poverty. Do not disrespect me that way. I am human too with feelings. Kz
You know the world has gone crazy when the real kz is fake and the one perceived fake is real. I love this website. I don’t regret following the advice of one of my junior staff to join it. However, can I just say that this website can be quite addictive
.
There is no need absolutely for inclination either to the employers’ or employees’ side in this discourse. What is needed is a correct ” balancing” act. Remember, the employee/ employer status can oscillate between an individual in any one’s life. An employee of today may be tomorrow’s employer or vice versa.
KZ
To prove you are the real KZ who works side by side with mr lungu , put your aviator of a picture of you and the one and only mr lungu side by side that is not in the public domain
A Professor with no academic acumen, and no longer holding a University position. Soon even prostitutes in Zambia will start calling themselves Professors. Just google is name on google scholar you will see that he is empty just like his head. That is Zambia the real Africa.
Great KZ, to hear you are not invincible, you are frail, vulnerable, weak and human. You are not a better cut above Zambians you have caused harm and pain, not only to individuals and their families. Acknowledgement of these heinous acts to other fellow human beings and capitulation with remorse would be a good starting point and begin to apologise to Zambians – as you know Zambia is a christian nation, if coming from a genuine heart God will help you to heal.
Munadek how do I apologise for wrongs that I have not done? Haha you are a confused little chap. You are behaving as if I stole your wife. Are you desperate for an apology? Ok here goes, I am sorry for not being found with any case to answer. I am sorry for there being no evidence to prove allegations. I am sorry for being good at my job and securing the presidency under pf on two occasions. I am sorry I love my country so much that I defend it everywhere I go even if it means annoying diasporans.
This is a very good piece of legislation.
1. It provides that if you resign you are paid your dues as per number of years worked unlike in the past were employees walked away with nothing from companies after resigning.
2. Employers give employees a very low basic salary and the rest of the salary is in allowances. The idea is to limit gratuity and pay employees next to nothing when they retire and you wondered why retirees especially those from the private sector have been languishing in poverty.
This is very good legislation and the government must not back down on it. This sort of research is the kind that would be funded by Mining Multi-National Companies to exploit Zambians. Have you not wondered why this research has no details? Just english english and english. Prof. Itemize…
Prof. Itemize what is wrong with this piece of legislation clause by clause and tell us how to mitigate it otherwise you are sounding like very anti-Zambian worker.
Commerce Minister. No industries, so why keep the portfolio in cabinet, just put up a directorate under Ministry of Finance to handle the little commerce issues. A country with a GDP of 25 billion dollars, Indias tycoon Mukeshi Ambai is worth 43 billion dollars, just an individual twice the GDP of Zambia. This ka country of ours is small ehh….
This act protects Zambians. As usual inferiority complex Zambians supporting those the worship. Are we ever going to be like Tanzanians, Nigerians or Ethiopians that don’t give a hoot about who an Indian is?
Many are asking why is the economist complaining now? This because it will be effective 1st may 2020. Companies were given a 12 months waiver to put systems in place.
Zambians its time to wake.All minerals in this country belongs to we the people of Zambia, its not for foreigners, its our minerals therefore we decide what happens NOT foreigners if they want to go…cool. This is the reason why America,Europe,Asia keep on oppressing Africa and wanting Africa to remain poor is because of its rich minerals.Africa the hour has come to wake up. Take what rightfully belongs to you.